Health Care Spending Doesn’t Translate to Better Health

March 13, 2017

In a paper published in JAMA Internal Medicine, Anupam Jena, Joseph Newhouse, Alan Zaslavsky and coauthors from the Harvard T.H. Chan School of Public Health found that Medicare patients treated by doctors that ordered more tests and procedures had no better mortality and readmission rates than lower-spending doctors.

The paper is one of the first large-scale investigations of variation in individual physicians’ spending patterns within the same hospital—it hasn’t been clear until now whether physician-level spending and quality are linked and by how much. The study indicates that there is no relationship, at least in the patients studied.

If you spend more money on a car or a TV, you tend to get a nicer car or a better TV. Our findings show that’s not the case when it comes to medical care. Spending more doesn’t always mean you get better health.

The potential reasons or fixes for this issue may not be as simple as spending less: doctors may need to be educated about the tests they order, or some doctors may be less efficient than others. This research, like others, also questions the fee-for-service model, which rewards higher spending but not outcomes.